January 12, 2004

January 12, 2004 | Commentary on

Want to Limit Lobbying? Cut Government

Presidential candidates John Kerry and John Edwards have been trying to breathe life into their moribund campaigns by attacking lobbyists.

In their view, the traditional Washington career path -- a stint in government followed by a lucrative job lobbying former colleagues -- is inherently corrupt. Both candidates propose restrictions, including limits on the ability of former government officials to function as lobbyists.

Is this the right approach? To be sure, lobbyists aren't the easiest group of people to defend. Many are for sale to the highest bidder -- willing to advocate a certain position one year, then urging the opposite position the following year simply because a client with more money comes along. And there surely is a conflict-of-interest -- or at least something unseemly -- when a government official oversees the implementation of a complicated regulation before taking a high-paying job to "help" the private sector comply with it (akin to paying a thief to find your missing wallet).

But even if every lobbyist was amoral (which certainly isn't true), that doesn't mean regulatory restrictions on the profession would be effective or desirable. In large part, this is because Sens. Kerry and Edwards are trying to treat the symptoms while ignoring the underlying disease. The real problem is that government is too big and has too much power -- and this attracts lobbyists for the same reason that rotten meat attracts flies.

In other words, lobbyists exist because many people cannot resist the temptation to try to redistribute resources in their direction -- while others seek representation because they don't want to be the chumps footing the bill.

Consider the numbers: The federal government is spending more than $2.3 trillion this year. Should we be surprised that various interests band together and lobby to get a slice of that bloated pie? On the other side of the ledger, taxes consume more than $1.8 trillion of our economy's output. Is it a shock to discover that people will do whatever they can to minimize this enormous burden, or at least reduce their share of it?

And don't forget federal regulations. Rules and red tape cost the economy about $850 billion annually. Does anyone really think it odd that this costly regulatory maze encourages lobbying?

This is why restrictions on lobbying will never be effective. Congress can pass thousands of laws to limit lobbying, but none of them will work so long as government has power to seize resources from one person and give them to another. New laws might change the way lobbying takes place, and they almost surely will make lobbying more expensive, but the process will continue.

(This also explains why campaign finance laws are futile. Even with a Supreme Court that ignores the Constitution's protection of political speech, people will find a way to pour money into political races either because they want to elect politicians who will redistribute money in their direction or they want politicians who will protect them from having their pockets picked. Campaign finance laws simply make the process more costly and increase the relative influence of the media and the wealthy.)

Interestingly, many of the politicians who complain the loudest about lobbying are the ones who want to make government even bigger. Edwards and Kerry, for instance, have tax-and-spend voting records that make French politicians seem fiscally responsible by comparison. Needless to say, this means we would almost surely be plagued with even more lobbyists if either candidate made it to the White House.

But this isn't a partisan issue. Republicans control the White House and Congress, yet spending has climbed to record levels -- and the budget is growing much faster than it did the last time Democrats controlled both ends of Pennsylvania Avenue. Little wonder that recent reports show that lobbying expenditures also have reached all-time highs.

Republican political appointees also are a big problem. Many of them are unwilling to back free-market policies and support the president's agenda because they don't want to alienate career bureaucrats. They need to be on good terms with those bureaucrats if they want to charge big fees when they cash in on their government "service" and become lobbyists.

A good example is the fight over a proposed Clinton-era IRS regulation that would compel U.S. banks to report interest paid to foreign depositors. Despite strong opposition from the White House, the financial service industry, Capitol Hill and taxpayer organizations, mid-level Treasury Department officials are fighting on behalf of this radical proposal even though it would drive money from the economy.

Lobbying can be a sleazy activity. It can even create incentives for political appointees to undermine a president. But new laws aren't the answer. Reducing the size and power of government is the only way to reduce influence peddling in Washington.

Daniel J. Mitchell is McKenna senior fellow in political economy at The Heritage Foundation.

About the Author

Daniel J. Mitchell, Ph.D. McKenna Senior Fellow in Political Economy

First appeared on FOXNews.com